Redcar, steel production, Brexit and democracy. A different prospective.

Today, Victoria Derbyshire program aired a heart-wrenching program on Redcar and the unemployed steel workers. Later this morning I read an article in the Financial Times about membership of Britain for the last 45 years in the EU. It made for an interesting new viewpoint. Let's take the steel first.

The TV program interviewed unemployed steel workers who now have no prospect of a decent job for the foreseeable future. Speaking to these people they claimed that they were not xenophobic, but their area had one of the highest white to coloured people ratios in the country. They voted by a ratio of 3:1 for Brexit, one of the highest in the referendum. Why? Well, for a start it was because the EU got the blame for the closing of the steel mills. What was not said was:

1. The EU also saw a reduction of 40.000 jobs in the steel industry and a reduction in world demand of around 25%. At that time, the British £ was very strong, making exports of steel even more expensive, in a shrinking world market. China's massive capacity was now turning outward, and that government started effectively 'dumping' steel making it very much more difficult for others to compete. There were, as indeed there still are some voices calling for deregulation of subsidization, while Labour wanted to nationalize, but this could not be done because EU regulation forbade it.

It could be said that the EU in fact did Britain a huge favour, because neither nationalizing the industry nor subsidizing production is any kind of sound solution. A much better (and in fact the only real solution) is what China is now doing; forecasting and planning well in advance. Seeing the way the wind is blowing, it plans to reduce its productive capacity by 150.million tonnes/ year over the next 5 years. Presumably this also means finding alternative ways of using the free manpower, which in turn means retraining. Another point to consider is that it was the strong £ against the € that made it worse for Britain, something that would not have been an issue under a single currency. (Just saying without prejudice - In fact there were many more reasons not to join the Eurozone)

2. The FT article analysed the claim that EU costs Britain £. x bn./ yr. In fact they proved that since the creation of the EEC and before joining in 1973, the British manufacturing sector was far inferior to that of Europe. Principally because of increased competition, many of the more successful companies of today learned fast that the only way to survive was to become more efficient in order to compete with larger EU companies. The last few years, under a Conservative government has seen investment strangled, firstly by the austerity program and now by the reluctance on behalf of business to invest because of Brexit uncertainties.

The FT numbers and graphs proved that since joining in 1973, British industry improved dramatically, reducing the difference with Europe considerably and resulting in growth and a closure of the gap, with a surplus many times over. The Tories themselves have claimed that the British growth rate exceeded the average of the EU, something they rarely managed to do before joining. The demand for a return of parliamentary sovereignty is not unlike the inmates of an asylum demanding that the leader should be an inmate, not a doctor because it is anti-democratic.

In conclusion I leave two messages, one for the victimized people of the North, and the other for the Londoners. To the Northerners I say this. I am truly sorry about your woes, but consider this. If many of your older folks are too proud to accept a £2 basket of food because it is charity, what do you call using taxes from the rest of the country to prop up an industry where the output cannot be sold at its production price because it is too expensive? Change is never easy, and retraining for middle-aged may be difficult, but if the alternative is starvation ... you can find the strength in yourselves to retrain.

To the Londoners, I say this. You may well be the economic powerhouse of 'Great' Britain, but you yourselves have admitted that London has a very high percentage of foreigners. They are more than welcome of course, but is it fair for the whole country to be paying to look after them?

Don't get me wrong, I know they are paying for their own upkeep, but is it fair to use British resources to develop more infrastructure for them? It should come from them, and leave British resources behind to help close the gap between London and the rest of the country. This may lose Britain some foreign trade (although I doubt it) but it is the only way fair way to restore balance.

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